Clear blue sky above rows of brown houses.

Policy Exchange’s reinvention of the planning system: a step too far?

Picture the scene: the year is 2030 and development company BuildBox has brought forward a planning application for a new office building on the edge of a large northern village. It seems like an unusual plot for a sci fi film but bear with me. A few years earlier the application would have taken months or even years to go through the system, but thanks to the wholesale reform of planning law proposed by Policy Exchange back in 2020 and fully enacted in 2025, the proposal is quick and easy for the council to decide.

First the planning officer checks the scheme is sited in development land. Every square meter of England has been allocated as either “development land” or “non-development land”. The latter covers most public green spaces, areas of natural beauty and conservation areas.  Much of the space that was in the Green Belt has been designated as “development land”, as has nearly all urban and green field land. The old allocations of land for residential, employment and so on have been scrapped, as have the land use planning designations such as A1 for shops and C2 for hotels. Instead we have a simple binary split: development or non-development.

The decision on what is development land was made by the council in their Local Plan, alongside just a few tens of pages of development rules. The plan was approved by councillors after a public consultation and signed off by a Planning Inspector. The plan sets out what is not acceptable in developable areas and what limited development is acceptable in non-development land. If your scheme is on development land, you can do anything the rules don’t specifically forbid .

Were BuildBox proposing a simple application such as a home extension, the planning officer would probably reach a decision on the same day. In this case, the office block is a larger application so will take a little more work, but it will still be decided relatively quickly. The days of applications being publicly advertised and consulted on before a committee of elected councillors makes the final decision months later are long gone.

Nor do planning officers try to micro-manage schemes or get involved in the finer detail. Applications are all measured against the simple rules: pass or fail. As for what goes where and other matters of detail, that’s up to the market to decide. Building regulations are still enforced, but that’s pretty much as far as it goes.

Policy Exchange

This is how think tank Policy Exchange believes the planning system should work. They set out their vision in a new paper: Rethinking the Planning System for the 21st Century. It calls for a code-based approach led by the market, with councillors and the public having no input into individual planning applications.

Policy Exchange argue that such a system would have many benefits:

  • Flexibility to deliver the development that’s actually needed, not the development that planners thought might be needed when they wrote the plan 15 years before.
  •  Far more certainty for developers that applications in line with the rules will be granted.
  • An end to artificial restrictions like Green Belt constraining housing supply and so driving up house prices – punishing the young and poor while rewarding the old and rich.
  • A similar reduction in the cost of commercial real estate.
  • An end to the domination of planning by a noisy NIMBY minority.
  • More market share for smaller house-builders, no longer locked out by the time and expense of the over-complex planning system and inflated land prices.
  • A simpler role for planners who are currently pulled in too many different directions.
  • Far less scope for expensive legal challenges of decisions.

The report rejects the often-cited idea of land value capture, arguing that developable land prices will naturally fall when the risk of development is reduced through their proposals.

For Policy Exchange this is not simply a debate about the planning system. They argue that their proposals would boost the whole economy, for example saying:

“Retailers are impacted by land use restrictions forcing them onto less productive sites in less restrictive locations. Academics found that this effect reduces productivity by 32 per cent in a representative store of a large supermarket chain.”

By freeing up development and allowing price signals rather than planners to direct building, Policy Exchange argue that their plan would see more homes and lower house prices, allowing “generation rent” to finally get a foot on the property ladder.

The report’s authors have identified much the same problems with our current planning system as noted in numerous reports over the last two decades. Their solution, though, is quite distinctive.

A step too far?

Many feel that, despite the challenges it brings, having public and political involvement in planning decisions is a beneficial aspect of the English system. It would be a brave government of any political hue that acted to scrap that, along with swathes of Green Belt, and introduce a free-for-all.

Planners will also be sceptical that Local Plans can really be cut down to a few pages. The National Planning Policy Framework (NPPF) may be brief, but planning officers still refer to hundreds of pages of more detailed older policies where the NPPF doesn’t quite do the job.

Realistic or not, this is a provocative addition to the long-running debate on whether and how our planning system should be reformed which will certainly be receiving attention in the corridors of power.